Marketing management Strategic Decision Making Approach

Question: Discuss about the Marketing management for Strategic Decision Making Approach. Answer: Introduction Marketing and management is a huge field that covers the concepts of production, product, selling, marketing and societal marketing. This study put stress on identifying a current issue faced by Airbnb and providing appropriate solutions after carrying out an internal and external environmental analysis of the company. Airbnb, which is an online hospitality and marketing service company of United States, is currently facing legal issues in Sydney, Australia after the banning of short-term leasing accommodation for tourists in most of the residential parts of Sydney. In February 2016, City of Sydney Council restricted the number of people and days in a temporary rental property. An enquiry reveals that there are 45000 properties are available through Airbnb for temporary renting to the visitors. Tourism Accommodation Australia is concerned that some of those properties play the role of commercial hotels, where the properly is provided in rent for years and the owner is not there. Te owners of those properties would be fined for not following the legislations related to short-term renting in Australia. This restriction acts as a significant barrier for Airbnb in hosting short-term tourists (Abc.net.au, 2017). Mckinsey 7-S model discusses seven factors related to marketing management those are categorized into hard and soft elements. Hard elements include strategy; structure and system whereas; soft elements are shared values, skills, style and staff (Fisk, 2013). Airbnb maintain shared consumption of business strategy that allows the people to share their resources. The company also maintains a cool reputation and image in the hospitality market. Moreover, the company has a verification system for sustaining online trust for travelers. In order to increase the value of the company, it is focused on providing support 24/7 in more than 30 languages. The organization includes highly skilled staffs, which provide excellent services to the customers. However, there is a lack of focus on the business model, which may have a negative impact on the environment (Hitt et al. 2012). External analysis PEST- Australia has a stable political environment, which is a positive factor for Airbnb to conduct business in that country. It has a transparent and efficient legal framework for short-time renting properties those must be followed by Airbnb for avoiding legal issues that the company is currently facing. The country includes a growing economy and well educated, skilled and multi lingual staffs that provide a wide opportunity for the tourist organizations like Airbnb. Being a tourist destination, property price is high, due to which demand of rental housing is increasing rapidly. As the society includes people, who can speak in various languages, hence, this makes easier to rent property to the tourists belong to different regions. Apart from that, rapid technological development provides technological and scientific assistance to the defense force and department of defense that ensures the safety of the tourists (Nunkoo et al. 2013). Porters five forces Threat of new entrant- It is moderate for Airbnb, as to compete with brand equity of the company, one would need high capital investment. On the other hand, it is not difficult to entry in the market for competing with the company by creating a website (Peppers and Rogers, 2012). Threat of substitute- It is high, as switching cost for the customers is zero and they can go to traditional hotels. Power of suppliers- This is low, as, proprietors do not have any better option to connect with consumers. Power of buyers- This is also low because customers do not have actual substitute right now. Competitive rivalry- This is moderate or low. Other services are also available; however, they are not as successful as Airbnb. Airbnbs agency Pereira Dell created a campaign and translated globally that discovers 16 housing views of 5 countries in the world. It commemorates the different perspectives and local experience with Airbnb. The aim of the campaign is to uncover the authentic and rare views with the company, which inspires tourists to increases their views about the world. Thus, the company involves maintaining its brand identity and core competency and eventually gaining competitive advantages (Mullins et al. 2012). Solution to the identified problem As, the company is facing legal issues, hence, while devising international marketing strategy, the company must consider all the legal frameworks related to short-term renting so that it does not have to face any such further issue that can reduce its reputation and brand value. The company should assign efficient lawyer, who can understand the legal requirements and suggest the company to take effective measures to avoid any legal issues. The company needs to understand all the legal requirements imposed by Australian council regarding short-term renting properties so that the company can maintain an effective relationship with their suppliers. References Abc.net.au (2017). Airbnb ban in NSW not the answer, report tabled to Government says. [online] Available at: https://www.abc.net.au/news/2016-10-19/airbnb-ban-in-nsw-not-the-answer-report-tabled-to-government-say/7947912 [Accessed 11 Mar. 2017]. Fisk, R.P., 2013. Lmpression management 26 in services marketing: a dramaturgical perspective.Impression management in the organization, p.427 Hitt, M.A., Ireland, R.D. and Hoskisson, R.E., 2012.Strategic management cases: competitiveness and globalization. Cengage Learning Mullins, J., Walker, O.C. and Boyd Jr, H.W., 2012.Marketing management: A strategic decision-making approach. McGraw-Hill Higher Education Nunkoo, R., Gursoy, D. and Ramkissoon, H., 2013. Developments in hospitality marketing and management: Social network analysis and research themes.Journal of Hospitality Marketing Management,22(3), pp.269-288 Peppers, D. and Rogers, M., 2012. A new marketing paradigm: share of customer, not market share.Managing Service Quality: An International Journal, pp.58-129